Market Watch with Tom Waitt

May_25th_2011.mp3 Emotion and Commotion    Last week we focused on the shares of Barnes & Noble which was out of favor with 73.7% of the share float shorted and was trading at $13.90 below it's book value of $14.48. Last Friday a takeover was announced today the stock is $19.33 up 39%. Value & market emotion are key to success. Market Emotion Cycle (click for larger picture) Fear and Greed tend to rule at market tops and bottoms. In the movie "Wall Street" Gordon Gekko says Greed is Good as the market soars higher. In market parlance the opposite of Greed is "Fear" which is bad for Investments. The market has a tendency to scare people out at the bottom and suck them in at the top. The market emotion cycle sees optimism turn to excitement, the thrill leads to euphoria and "Greed" slipping to anxiety, denial and "Fear" followed by desperation panic, capitulation, despondency ,depression, disgust and doubt. Globalization is upon us with what happens half way around the globe